Mantan Wartawan Sumbang Sabotaj Ekonomi

Pengadu-domba dan mereka yang berdusta sebagai modal strategi politik untuk meningkatkan kedudukan mereka dikalangan rakyat dengan menghasut dan memburukkan pemimpin, walaupun ianya akan menjejaskan kemakmuran negara.

Terdapat pelbagai khabar angin dan pembohongan yang engage diada-adakan tau dimanipulasi dari fakta atau kenyataan sebenar hanya dengan objektif untuk mencapai menimbulkan kebencian dan menggurangkan keyakinan keatas kepimpinan dan dakar dan program-program strategi yang diusahakan.

Ini termasuk program strategik pembangunan ekonomi, yang bakal akan jadi pemangkin dan ‘penggerak permainan’ (game changer) seperti projek Refinery and Petrochemical Integrated Development (RAPID) di Timur Laut Johor.

Ianya merupakan pelaburan strategik Petronas paling besar setakat ini yang dianggarkan berjumlah RM60 billion dan program utamanya ialah Penggerang Integrated Complex (PIC). PIC dirancang untuk kapasiti memproses dan menyaring sehingga 300,000 tong minyak mental sehari.

Kunjungan ulung Raja Salman Al Saud pemerintah Arab Saudi bulan lepas telah menyaksikan Petronas memeterai perjanjian dengan Aramco Saudi, dimana syarikat ‘seven sisters‘ itu akan melabur RM6 billion dalam projek PIC.

Laporan Utusan Online:

Petronas, Saudi Aramco meterai SPA RAPID

AHMAD SHAZWAN MD. YUSOF
28 Februari 2017 3:25 PM

KUALA LUMPUR 28 Feb. – Petroliam Nasional Berhad (Petronas) dan Saudi Aramco hari ini menandatangani Perjanjian Pembelian Saham (SPA) bagi penyertaan ekuiti syarikat minyak Arab Saudi itu dalam projek Pembangunan Bersepadu Penapisan Minyak dan Petrokimia (RAPID) di Pengerang, Johor.

Majlis pemeteraian itu disaksikan oleh Raja Arab Saudi, Raja Salman Abdulaziz Al-Saud dan Perdana Menteri, Datuk Seri Najib Tun Razak di sini.

Petronas diwakili Presiden dan Ketua Pegawai Eksekutif Kumpulan, Datuk Wan Zulkiflee Wan Ariffin sementara Saudi Aramco pula diwakili oleh Presiden dan Ketua Pegawai Eksekutifnya, Amin H. Nasser.
Yang turut hadir, Menteri di Jabatan Perdana Menteri, Datuk Seri Abdul Rahman Dahlan dan Menteri Tenaga, Industri dan Sumber Galian Arab Saudi, Khalid Al-Falih.

Menerusi transaksi jual beli saham itu, kedua-dua syarikat akan memiliki pegangan ekuiti sama rata ke atas beberapa projek dan aset penapisan minyak, loji perekah dan kemudahan petrokimia RAPID dalam Kompleks Bersepadu Pengerang (PIC) dengan sejumlah AS$7 bilion (RM31 bilion) bakal dijana menerusi kerjasama berkenaan.

Menurut Wan Zulkiflee, PIC merupakan salah satu projek terbesar di Asia Tenggara dan pelaburan terbesar Petronas bagi sektor hiliran.

“Perjanjian ini merupakan peristiwa bersejarah bagi industri minyak dan gas kerana dua syarikat minyak terkemuka berkongsi dalam membangunkan projek baharu bertaraf dunia.

“Perkongsian ini bakal mengukuhkan lagi kedudukan, pengalaman operasi serta prestasi kedua-dua syarikat dalam membangunkan projek-projek mega serta rangkaian komersial dalam pelbagai pasaran global,” katanya. – UTUSAN ONLINE

Artikel Penuh: http://www.utusan.com.my/bisnes/ekonomi/petronas-saudi-aramco-meterai-spa-rapid-1.450173#ixzz4c6gWTiPV
© Utusan Melayu (M) Bhd

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Ianya bukti kerjasama erat bukan sahaja diantara dua negara Islam ini tetapi dua pemimpin, yang saling mempunyai penghormatan dan keyakinan tinggi sesama mereka.

Pelaburan ini secara automatiknya melenyapkan laporan media asing sebelum itu berkenaan Saudi Aramco menarik diri keluar dari rancangan untuk melabur di RAPID.

Laporan Reuters pada 27 Januari 2017:

Aramco snub puts Malaysia’s Petronas in tight spot over RAPID project

By Emily Chow and A. Ananthalakshmi | KUALA LUMPUR
Saudi Aramco’s decision to shelve a plan to partner with Malaysia’s state oil company threatens the country’s ambitious plans for an oil and gas processing hub, which it may struggle to keep on course if it cannot find another foreign investor.

The Saudi oil major suspended plans for a joint venture with Petroliam Nasional Berhad, or Petronas, on the $27 billion project in the southern Malaysian state of Johor due to concerns it would not yield high returns, sources told Reuters this week.

Petronas – which has been hit hard by the slump in oil prices, cutting jobs, capital expenditure and its contribution to government coffers – insists the Refinery and Petrochemical Integrated Development (RAPID) project at Pengerang, on Malaysia’s southern tip, remains on track and will begin operations as planned in 2019.

Analysts say the project is too politically important for Prime Minister Najib Razak, mired in a corruption scandal involving state fund 1MDB, to be scrapped or drastically pared back, but believe Petronas will need a strategic investor to bring in funds and industry expertise.

“They may scale it down, but it’s going to go ahead. It might get staggered,” said Subbu Bettadapura, senior director of energy, Asia Pacific, at consultancy Frost and Sullivan.

“(Malaysia) would definitely try to channel funds into Pengerang because a lot is riding on that. All the forces, political and industrial, would be trying to make this a reality.”

Industry analysts and consultants say Petronas is in talk with other foreign investors.

Najib – who has said RAPID will create jobs, raise standards of living and boost the country’s economy – will want to ensure the project in electorally key Johor state faces no further hurdles before the next national election due by 2018.

With Western oil majors also hurting from a slump in oil prices, the most likely solution for RAPID would be to recruit Chinese players to partner with Petronas.

Some analysts say cash-rich Chinese refiners looking to expand into new markets could be interested in RAPID.

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Najib has been moving closer to Beijing diplomatically as the fallout from the 1MDB scandal strains ties with the United States, returning from a November state visit to China with about $34 billion in deals.

“Najib needs to ensure that RAPID can still go on,” said Achmad Sukarsono, analyst at political risk consultancy Eurasia Group. “Politically Najib would want to involve China more.”

PROJECT ECONOMICS

Others, however, caution that RAPID may not make sense for China, which already has enough refineries to meet even its huge oil thirst. Chinese energy firms, they say, would rather invest in more crude production.

A bigger concern is the economics of the project, which have been called into question after sources said Aramco had concluded it would not generate sufficient returns.

Petronas said in a statement on Thursday that RAPID – which includes a 300,000-barrel-per-day oil refinery producing gasoline and diesel – was expected to deliver positive returns and value as planned.

The project, part of the huge Pengerang Integrated Petroleum Complex (PIPC), was announced in 2011 when oil traded at $110 a barrel. Crude prices have since halved.

Like neighboring Singapore, the Pengarang peninsula sits between the Malacca Strait and the South China Sea, through which almost all the Middle East oil and gas bound for northern Asia’s industrial powerhouses of China, Japan and South Korea is shipped.

If fully developed, PIPC would become one of Asia’s biggest hubs for oil storage, fuel refining and petrochemical production, as well as imports and exports of liquefied natural gas (LNG).

Sushant Gupta, research director of refining and chemicals at energy research and consulting firm Wood Mackenzie, predicted Asian markets will be short of gasoline by 2020, meaning RAPID could hit the market at the right time to benefit from improving refining margins.

“So it will be prudent for the sponsors to get the refinery ready on time to capture the expected upswing in margins,” Gupta said.

CANADIAN SACRIFICE?

The RAPID setback means Petronas now faces questions over two of its biggest projects.

It is in the middle of making a final investment decision on a $27 billion liquefied natural gas project in Canada that has faced several delays due to environmental concerns.

The state-run company is also wrestling with lower profit and cash flow. In early 2016, Petronas said it would cut spending by up to 50 billion ringgit ($11.27 billion) over the next four years.

With the questions hanging over RAPID, Petronas may be forced to re-think the Canada project.

“RAPID will still come online, it’s just there is a greater financial burden on Petronas now,” said Peter Lee, an oil and gas analyst at BMI Research. “If anything were to give way or be delayed further, I would think it is the Canada project first.”

For graphic on Pengerang oil and gas development click: tmsnrt.rs/2kAw5RZ

(Additional reporting by Mark Tay and Henning Gloystein in SINGAPORE, Reem Shamseddine in KUWAIT; Editing by Alex Richardson)

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Dalam pada itu, terdapat khabar angin yang amat popular sedang aktif digembar-gemburkan dikalangan penggiat politik Pembangkang dengan dusta memburukkan Kerajaan Pusat terbaru.

Mereka begitu berusaha untuk mengambarkan bahawa Perdana Menteri Dato’ Sri Mohd. Najib Tun Razak sebenarnya amat tidak berpuas hati dengan Presiden dan Ketua Pegawai Eksekutif Kumpulan Petronas Datuk Wan Zulkiflee Wan Ariffin, berdasarkan maklumat yang dimanipulasikan dan ditambah dengan pembohongan.

Ini disandarkan kepada sidang media Datuk Wan Zulkiflee pada 22 Februari 2017.

Laporan The Star:

Wednesday, 22 February 2017

Petronas clears the air on partnerships

BY RISEN JAYASEELAN

KUALA LUMPUR: Petroliam Nasional Bhd’s (Petronas) discussions with potential equity partners for its projects are driven by its interest in bringing in new technologies, as well as diversifying risks in exploration activity.

It is not with the view of getting funding to help finance its projects.

President and chief executive Datuk Wan Zulkiflee Wan Ariffin said that when the national oil company embarks on a project, the entire funding requirement would be factored in.

“We never take on a project with the view that we have to depend on investors for funding to complete the project,” he told senior editors at a briefing here yesterday.

“We are always in discussions with potential partners to maximise the value of our projects and better manage the cash position of the organisation. But we are not dependent on anyone for funding to complete the project. We only pursue partnerships on terms acceptable to us,” he said.

Recently, wire news reports suggested that Petronas was looking to divest a large minority stake in a key Sarawak offshore gas field, and that the sale was partly driven by a need to raise cash at a time of low oil and gas prices.

Earlier reports stated that Saudi Aramco had pulled out of a plan to get involved in Petronas’ Refinery and Petrochemical Integrated Development (Rapid) project in Pengerang, Johor.

The reports suggested that the pressure was on Petronas to find a new partner or struggle to complete the project.

Wan Zulkiflee expressed surprise at the report of Saudi Aramco pulling out of Rapid when it had not gone into any agreement with the entity from Saudi Arabia.

“How can there be a situation of a party pulling out of something when the party was not part of it in the first place?” he said referring to reports of Saudi Aramco supposedly pulling out of Rapid.

“From day one, we have stated that we are able to fully fund Rapid. We are and will not be dependent on anyone for this project. We are close to 60% complete, costs are within projections and the refinery will be ready by 2019 followed by the petrochemical portion by 2020.”

On the potential sale of equity in the Sarawakian oil field, Wan Zulkiflee said that one of the criteria in looking for a partner was in finding one that is able to bring new technologies that make the extraction process more efficient, considering that the gas field contains high levels of carbon dioxide.

“There is also exploration work there, so it is in the normal course of business to find a production sharing partner to share the risks and rewards.”

Wan Zulkiflee also said that Petronas’ financials were intact, despite suffering from lower earnings due to the oil price collapse. Numerous cost-saving measures have also borne fruit.

“Just look at our balance sheet. We have more than RM130bil in cash. We have one of the lowest gearings among international oil companies at 17% and our ratings have not been downgraded in this entire period.”

On Petronas’ staff-rationalisation exercise, Wan Zulkiflee said that it had laid off 2,300 employees last year, which brought about an annual manpower cost savings of RM200mil.

“But the main benefit is that the exercise got rid of duplication (of roles) in the organisation and this, in turn, raises accountability. This is a much bigger win from this exercise than the cost savings,” he said.

Wan Zulkiflee also said that the oil major was using a price assumption of US$45 per barrel for Brent crude oil for its 2017 planning, and that it was maintaining its capital expenditure budget at RM60bil for the year.

The Government in Budget 2017 had also assumed oil to be at US$45 per barrel.

Despite the turbulent industry, 2016 marked many firsts for Petronas, said Wan Zulkiflee.

This included Petronas commissioning the world’s first floating liquefied natural gas (FLNG) liquefaction, storage and offloading vessel – Petronas FLNG Satu – which is now operating offshore in Sarawak. It also started commercial operations at the ninth liquefaction train at the Petronas LNG complex in Bintulu, Sarawak.

Last year, Petronas also commissioned its Sabah Ammonia Urea (Samur) project with first production expected soon. In 2016, the oil giant was also awarded deepwater exploration blocks in the Gulf of Mexico’s Salina Basin. It entered into a memorandum of understanding with National Iranian Oil Company to study two oil fields there and production of oil from Iraq crossed 100 million barrels.
Read more at http://www.thestar.com.my/business/business-news/2017/02/22/petronas-clears-the-air-on-partnerships/#KVm5jKYWMfJ7MQFB.99

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Walaupun Datuk Wan Zulkiflee menjelaskan bahawa beliau sendiri terkejut mengenai laporan Reuters itu kerana pada peringkat itu, kedua kedua pihak masih lagi dalam proses perundingan dan belum mencapai apa-apa persetujuan yang konkrit. Hatta, soal menarik diri tidak timbul pada peringkat sebegini.

Dalam sidang media yang sama, beliau juga menjelaskan apabila Petronas menimbangkan untuk memulakan sesuatu projek, perkiraan telah dibuat agar Petronas sendiri mampu untuk menjana program tersebut.

Namun, pertimbangan untuk rakankongsi juga sentiasa terbuka bagi menerima modal tambahan dan menjana kepentingan strategik seperti meningkatkan peluang jaringan melalui kerjasama dan rakankongsi, terutama kedalam kepasaran terbitan baru.

Ini merupakan salah satu track yang di layari Petronas dengan jayanya, sebagai sebuah operator huluan industri hidrokarbon ini apabila terbukti mampu beroperasi di 20 bush negara dan membawa pulangan yang lumayan.

Kejayaan kunjungan Raja Salman dan perjanjian Petronas-Aramco Saudi merupakan bukti bahawa keyakinan global keatas Malaysia dan pengurusan ekonomi oleh Kerajaan masih mantap.

Ianya amat bertentangan dengan apa yang digembar-gemburkan Pembangkang dan dicanang merata dunia dengan bantuan sesetengah media asing bahawa pengurusan ekonomi negara amat lemas, bebanan hutang diluar kawalan dan negara akan muflis.

Perdana Menteri Najib menyifatkan perbuatan fitnah ini sebagai cubaan untuk mensabotaj ekonomi negara.

Laporan Utusan Online:

Henti sabotaj ekonomi – PM

C.Sheila Rani
20 Mac 2017 11:24 AM

KUALA LUMPUR 20 Mac – Perbuatan sabotaj ekonomi harus dihentikan oleh mana-mana pihak demi kepentingan rakyat dan masa depan Malaysia.

Perdana Menteri, Datuk Seri Najib Tun Razak menegaskan, tindakan sedemikian tidak wajar diteruskan walaupun golongan berkenaan mempunyai perbezaan pendapat politik.

“Ada sedikit sebanyak unsur sentimen yang boleh dipengaruhi melalui cita-cita yang bertujuan untuk memburukkan keadaan ekonomi negara dengan meluahkan fakta-fakta yang tidak berasas dan tidak tepat.

“Ini tidak wajar diteruskan kerana kepentingan negara tidak seharusnya dijadikan pertaruhan dalam soal politik kepartian,” katanya ketika menjawab soalan Datuk Seri Dr. Irmohizam Ibrahim (BN-Kuala Selangor) dalam sesi soal jawab dalam persidangan Dewan Rakyat, hari ini. – UTUSAN ONLINE

Artikel Penuh: http://www.utusan.com.my/berita/nasional/henti-sabotaj-ekonomi-pm-1.459389#ixzz4c6o4Rkhw
© Utusan Melayu (M) Bhd

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Penyokong Pembangkang memanipulasi saranan Perdana Menteri Najib ini dan menyandarkan dengan beberapa laporan media sebelumnya, untuk terus memberikan gambaran yang salah dan berniat jahat.

Ianya sebahagian dari strategi Pembangkang untuk menghakis keyakinan rakyat walaupun realitinya berbeza, seperti episod pelaburan baru RM 6 billion di Penggerang, Johor itu berbanding dengan pembohonan bahawa keyakinan keatas ekonomi dan cara pengurusan.

Blogger Ganesh Sahathevan telah memanipulasi dua laporan media ini untuk memberikan gambaran sebenarnya Perdana Menteri Najib tidak senang dengan Datuk Wan Zulkiflee.

Beliau juga menuduh bahawa Presiden Petronas itu antara yang dinamakan sebagai “Individu yang mensabotaj ekonomi negara”.

Beliau merupakan mantan wartawan The Sun, telah melalui penulisan telah menyerang Presiden dan Ketua Pegawai Eksekutif Kumpulan Datuk Wan Zulkiflee Wan Ariffin:

While PM Najib provided no evidence of who exactly “almost sabotaged” the Aramco-Petronas JV,we do know that Petronas CEO and President Datuk Wan Zulkiflee Wan Ariffin himself expressed concerns about the JV just two days before signing, and he did so publicly ,via a press conference that he himself called.

The Star reported these matters:
Wan Zulkiflee expressed surprise at the report of Saudi Aramco pulling out of Rapid when it had not gone into any agreement with the entity from Saudi Arabia.
“How can there be a situation of a party pulling out o

f something when the party was not part of it in the first place?” he said referring to reports of Saudi Aramco supposedly pulling out of Rapid.
“From day one, we have stated that we are able to fully fund Rapid. We are and will not be dependent on anyone for this project. We are close to 60% complete, costs are within projections and the refinery will be ready by 2019 followed by the petrochemical portion by 2020.”

The above was preceded by an earlier report in The Star,dated 25 February 2017 in which Petronas seemed to be warning off PM Najib and his government.Headlined “Let Petronas Do Its Job”, the story included the following statements:

There has been a fair bit of speculation surrounding Aramco inking a deal with Petronas in relation to the latter’s Refinery and Petrochemical Integrated Development or Rapid project in Pengerang, Johor. The latest is that both parties will sign an agreement on Monday during King Salman’s visit to Malaysia.
Petronas has not said anything about any potential deal with Aramco, except that it is always in talks with potential partners, but that any deal inked would have to be on Petronas’ terms. In other words, beneficial to Petronas and not lopsided, as it should be.
Petronas’ president and CEO Datuk Wan Zulkiflee Wan Ariffin recently told editors in Kuala Lumpur that Petronas never takes on projects with the view that it has to depend on investors for funding to complete the project.
That said, partnering Aramco should have its benefits, considering it is not only the company with the vastest oil reserves, but also the most valuable company in the world today. The deal just has to be struck on equally beneficial terms.
…..the O&G resources of the country belong to all Malaysians, and they have to be handled with care.

It does appear then that it was the Petronas CEO himself who was trying to discourage Aramco, and he was not afraid of doing so publicly.

Then there is the matter of the EPF. Najib is reported to have said:

“Some unpatriotic people had spread claims that the Employees Provident Fund (EPF) was almost bankrupt and that the government was unable to pay the salaries of its civil servants.
“The Saudi Arabian government had received this wrong information about our country and thus, were quite doubtful about investing in Malaysia.
“We had to meet them and correct the facts that Malaysia is among the best countries in the world (to invest in). When they were convinced, they finally agreed to invest with us” .
However, Aramco sells its crude to Petronas, and it would,as any oil company would, be interested only in the viability of its client. If otherwise, Shell, ExxonMobil and others would not be investing in say Nigeria. Put in another way, oil companies have long ago learnt to limit their exposure to the oil assets that they deal with, managing to ring-fence these from the problems of the countries they deal with.
Therefore the matter of EPF would be of interest only if the EPF is expected to bail-out the RAPID project, for a bail-out is what it would be.If not, the EPF would already be an investor in the project. A bail out should not be unexpected, given that the JV agreement with Aramco seems not to involve any injection of cash.
END
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Blogger ini juga dengan tanpa bukti melibatkan KWSP (EPF) dalam artikel ini dan mengambarkan bahawa wang KWSP akan digunakan untuk ‘bail out‘ RAPID sekiranya perjanjian Petronas-Aramco itu gagal. Ini ditambah sekiranya tidak, KWSP sememangnya akan melabur didalam projek gergasi Petronas itu.

Mengheret KWSP dengan manipulasi maklumat yang tidak tepat adalah salah satu cara untuk menghasut agar terdapat dikalangan pencarum KWSP salah tafsir tulisan ini dan terpedaya dengan dakyah Pembangkang bahawa ekonomi negara sebenarnya teruk dan tidak diurus dengan baik.

Maka ianya akan dijadikan sebagai titik untuk mula mebangkitkan kesangsian dan kemarahan dikalangan pencarum KWSP, yang rata-ratanya rakyat biasa.

Tindakan ini jelas sebagaimana yang ditekankan oleh Perdana Menteri Najib akan aktiviti mensabotaj ekonomi ini.

Amat malang sekiranya strategi untuk menghasut dan menjana kebencikan kepada kepimpinan dan Kerajaan Barisan Nasional memberi kesan kepada negara, terutama menghalang peluang perdagangan apa skala sekalipun dan pertumbuhan ekonomi, demi merealisasikan politik sempit sesetengah pihak.

Published in: on March 23, 2017 at 09:00  Comments (5)  

The Cost of Manja

The civil service bill

The civil service bill

In moving Malaysia forward not only into the newly developed nation status but a high middle income nation, the rakyat must do their bit together with enthusiasm and not leave everything to the Government to realise, execute and bear the cost.

The Malaysian Government under Prime Minister Dato’ Sri Mohd. Najib Tun Razak laid out a target to be a high economy nation with the people able to obtain high income, which should be realised with one of many strategies is the rationalisation of subsidies.

The fundamental philosophy of a ‘Government’ is ‘To provide the things and services that people cannot provide for themselves’.

Let us Malaysians take a close look at that. Do we provide and do things ourselves and minimise the burden to the Government?

As  a general rule, Malaysians don’t. They prefer other people to do these things for them. Conveniently, the Government. Anything and everything, even the petty of things in their daily life, they blame and put the responsibility on Government.

Example like the power consumerism. If there are errant traders who do profiteering, can the consumers do anything about it if they feel they have been bullied or treated unjustly?

Oh yes they can! They can boycott such traders. Even the cartel, if the community which felt unjust.

But do they do that? No. Usually they do nothing but complain. They conveniently  put the burden on Government, to act for them.

“Government should……” is one the most widely used phrase amongst Malaysians all walk of life.

Many of rulings and directives have to be ‘enforced’, which means enforcement officers have to assigned. A quick example is ‘meter maid’ by municipalities and local authorities, to enforce parking rules are observed.

This cost could otherwise be minimised if the people in their earnestness abide by rules without much supervision.

Taken that some essential services involving security such as like military, police, prisons, immigration, coast guard etc. have to be provided and manned by civil servants. However, sort which could be automated with the advancement of technology such as administrative is actually growing.

The work demand partly created by service required or expected to be delivered by the Malaysian public actually saw the civil service growth, both horizontally and vertically. Some ministries even provide three Deputy Secretary General positions, with corresponding Divisional Secretaries and Directors.

This is why the civil service is so enormous. 1.6mil people are employed on behalf of the Government to serve cogs and gears of the nation. Inadvertently, this is why to pay for the civil service cost the Malaysian taxpayers RM93 bil or 35.8% of annual Federal Government budget.

That alone is 78.8% chunk off the revenue collected by Inland Revenue Board of RM118 bil.

This is up and above bills that the Federal Government are already paying (at almost 100%) for the comfort of the rakyat, which is health and education.

The left over from direct taxes collected by IRB in the form of income tax and other taxes is RM25 bil, which is supposed to pay for other expenditures.

High operating expenditures such as paying emoluments and pensions for the civil service also means that lesser could be invested in socio-economic development capital expenditures.

The present ratio of 1 civil servant to less than 20 Malaysians is a little too high. This is even higher ratio than pre-corporatisation and privatisation of services like electricity, water, telecommunications, postal and other services.

Realistically, high civil service bill in annual budget is not a good indicator that the nation had moved forward as a newly developed nation. The economy may qualify to be in the cohort.

However, the attitude of the people is pointing towards that they are not quite independently developed.

Published in: on February 1, 2017 at 22:00  Comments (14)  

Expanding the Bumiputra Economic Agenda

The market flavour of the week is Some Darby Bhd. breaking up into three different core group and be listed separately as Sime Darby Bhd., Some Darby Property Bhd. and Sime Darby Plantations Bhd.

NST online:

Sime Darby may raise RM27 billion from unit listings

 

BY AMIR HISYAM RASID – 28 JANUARY 2017 @ 4:15 PM

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KUALA LUMPUR: Sime Darby Bhd could raise more than RM27 billion from the listings of its plantation and property companies while maintaining controlling stakes in them, analysts estimate.

Analysts gave thumbs-up to the spin-off plans but were split over upgrading, maintaining or even downgrading their recommendations on Sime Darby. Kenanga Research said if it kept a 51 per cent stake in each entity, the conglomerate could raise some RM27.2 billion from the listings.

The plantation arm could fetch RM19.4 billion and the property firm is expected to raise RM7.8 billion, which represents cash per share of RM4.10. Sime Darby announced on Thursday that its plantation and property units would be listed on Bursa Malaysia as Sime Darby Plantation Bhd and Sime Darby Property Bhd.

“We are positive with this move which should unlock value in both spin-offs, while substantially improving Sime Darby’s balance sheet position and potentially providing a bonus to shareholders in the form of dividends or shares in the new companies,” said Kenanga Research .

“Assuming Sime Darby retains 50 per cent of the RM27.2 billion funds raised and pays out the rest as dividends, this would represent a bumper dividend of RM2 per share or 22 per cent of the current share price.

“With the remaining funds, we would expect Sime Darby to enter into a net cash position from the current net gearing position of 0.4 times,” said the firm.

Kenanga Research upgraded its call on Sime Darby to “outperform” from “neutral” with a higher target price of RM9.88. MIDF Research downgraded Sime Darby to “neutral” with an unchanged target price of RM9.05 as it believed most of the optimism on the corporate exercise had been priced in.

The firm said its shareholders are likely to enjoy long-term benefits from the removal of “conglomerate discount” attached by the market.

“This is especially true for the plantation division as pure planters tend to command higher price earnings valuation against conglomerates with many businesses,” it said. Public Investment Bank Bhd affirmed its “outperform” call and RM9.30 target price.

It said Sime Darby Plantation, which was set to become Malaysia’s biggest listed plantation company, also had the largest planted landbank in the world. This is based on its vast planted landbank of 603,254ha across Malaysia, Indonesia, Papua New Guinea and Liberia.

“Taking into consideration its landbank size, regional footprint, fresh fruit bunch (FFB) production growth, FFB yield, age profile and current strong crude palm oil prices, we strongly believe the plantation arm should be able to attract healthy valuations for its listing.

“Based on our preliminary studies, the market capitalisation would likely be in the range of RM48 billion-RM55 billion or an estimated price earnings ratio of 25-30 times,” it said. PublicInvest said Sime Darby Property is set to be one of the largest players in the country based on its annual property sales of more than RM2 billion.

“Based on our valuations, the property arm could be listed at an estimated market capitalisation of not less than RM10 billion. However, the listing might be in the later part of the year as property sentiment remains lacklustre,” it added. Sime Darby kept its improvement on Bursa, edging up 4.65 per cent to RM9.23 from Thursday’s close of RM8.82.

The stock was Bursa’s top gainer yesterday and best performer year-to-date with a 13.95 per cent gain.

Read More : http://www.nst.com.my/news/2017/01/207936/sime-darby-may-raise-rm27-billion-unit-listings

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The decoupling of groups from the existing Sime Darby Group, which arisen from the merger of Some Darby, Guthrie and Golden Hope Plantations ten years ago is timely and a brilliant step moving forward.

The conglomerate now is listed under the Forbes Global 2000 list as number 813. If measured under market cap, then it is at number 867 of the same list.

It would provide better growth, arisen from focused separate teams and strategies. Example is property is a segment which Sime Darby could really capitalise and existing resources be optimised for better return on investment and value creation.

This is a strategy where Sime Darby Property could horse-back on the Government strategy of wealth creation and gallop on the bullish-ness of making Malaysia a high income nation.

The appetite for property, especially for commercial and high end and luxury segment is quite promising. Considering the Forest City development in Iskandar Malaysia, is a good example of the opportunities available and waiting to be capitalised.

The development of the High Speed Rail from Kuala Lumpur to Singapore is expected to pass through many of Sime Darby assets and investments, which could be developed for new satellite townships along the route.

Unlocking, realising and optimising value creation for PNB is a strategy laid by the new management team led by Tan Sri Abdul Wahid Omar as Chairman and Dato’ Abdul Rahman Ahmad as Group CEO two months ago. Unit trust schemes under PNB are strategic and majority shareholder of Sime Darby Bhd.

The Star story:

Friday, 25 November 2016

Malaysia’s largest fund-manager unveils strategic plan

BY HANIM ADNAN

KUALA LUMPUR: Permodalan Nasional Bhd (PNB), the country’s largest fund-management company which has a new team at the helm, has unveiled a six-year strategic plan to deliver sustainable, consistent and competitive returns to its unitholders.

PNB has set a target to increase its total assets under management to about RM350bil by 2022 from about RM259.49bil currently.

In a rare press briefing on its performance, PNB disclosed that was expecting a gross income of RM18.64bil and a net income of RM15.18bil with a return on assets of about 6.1%.

According to group chairman Tan Sri Abdul Wahid Omar, PNB has been able to deliver consistent returns to its unitholders, with over RM136bil having been paid out since its inception 38 years ago.

PNB is currently the market leader in the local unit trust industry, managing RM220bil in unit trust assets with 12.8 million accounts, representing over a 60% market share in terms of total fund value.

PNB also expects the dividend payout this year to be maintained, said Wahid as he unveiled PNB’s Strategic Plan 2017-2022 yesterday.

Meanwhile, PNB president and group CEO Datuk Abdul Rahman Ahmad said PNB recognised the challenges ahead in the period of global uncertainty, given the flat global economic growth and low interest-rate environment.

“This is exacerbated further by the negative trend of the FBM KLCI for the past three consecutive years attributed by the weak shareholders’ return of large-cap Malaysian corporates over the period,” he added.

PNB is a major investor in Bursa Malaysia with investments of nearly RM170bil or 10% of the market capitalisation of the bourse.

Its strategic holdings are in Malayan Banking Bhd (Maybank), Sime Darby Bhd, UMW Holdings Bhd, S P Setia Bhd, Chemical Company of Malaysia Bhd and MNRB Holdings Bhd.

It also has sizeable stakes of more than 10% in large caps such as Axiata Group Bhd, Tenaga Nasional Bhd, CIMB Group Holdings Bhd and Telekom Malaysia Bhd.

To counter the challenges ahead, Abdul Rahman said the PNB Strategic Plan 2017-2022 would chart the way forward for the group to deliver sustainable, consistent and market-leading returns.

However, he said that corporate Malaysia has to perform.

“Companies should not undertake mergers and acquisitions without enhancing shareholder value. Every single action that they take should create shareholder value,” he added.

To attain PNB’s vision to be a distinctive world-class investment house, PNB has formulated the Strive 15 programme which comprises three pillars – enhancing sustainable returns, effective investment management and driving operational excellence.

Abdul Rahman said: “We have developed a clear strategic plan to address current and future challenges, thus ensuring PNB can sustain its performance for the next six years and beyond.”

He pointed out that PNB would continue to invest in high-performing Malaysian corporates.

“Our cash is sizeable and we will continue to invest whenever the opportunity arises, including in fixed income when the time is right.”

At the moment, out of PNB’s investment portfolio, the cash position is about 20% and fixed income is 4%.

A 20% cash holding is about RM50bil in terms of absolute amount.

Towards this end, Abdul Rahman said that it would be redeploying some assets to reduce its cash position when the opportunity arises.

“We think that while it is important to hold cash, RM50bil is a bit too much,” he said.

Wahid added that there were a lot of things that could be done and achieved with PNB’s existing strategic investments.

“We will work closely with the management and board of our strategic investment companies to see how we can further maximise returns and create more value for these companies,” said Wahid.

Recently, there was a news report of a break-up of Sime Darby, the conglomerate in which PNB has close to a 55% controlling stake.

Spculation has been rife that both Wahid and Abdul Rahman were keen on seeing the board of Sime Darby come up with a plan to unlock value by having more individually listed entities as opposed to a single public-listed parent holding an array of different businesses.

On PNB’s cash position, Abdul Rahman said that the current cash position of 20% of total assets was definitely not optimal and that PNB would be looking to deploy those monies to work soon.

“We will source for new strategic investments and core portfolio companies. Private equity and fixed income will be another asset class that we are looking to increase exposure to,” said Wahid.

“For now, given the weak ringgit, we will not move into acquiring global assets.”

Abdul Rahman, meanwhile, is bullish on the positive growth of PNB’s funds, given the lows in the earnings cycle, historically low foreign ownership and the fact that “not often the KLCI underperforms for three consecutive years”.
Read more at http://www.thestar.com.my/business/business-news/2016/11/25/pnb-unveils-strategic-plan/#EBFD7oRdWT4QIXlC.99

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Hence, it is quite achievable that PNB increase its value by 34.6%, equivalent RM90 bil, from the current asset at RM260 bil to RM350 bil in six years.

The surplus of cash from the listing of two other Sime Darby groups is extra resource, to be realised in the optimisation of the existing market capitalisation of Sime Darby. Currently, it is hovering in the neighbourhood of RM62.8 bil.

Three years earlier, Some Darby set the target to bring the market cap to RM100 bil.

Bernama story:

Monday, 9 June 2014 | MYT 6:00 PM

Sime Darby aims to double market cap to RM100bil by 2016

 

KUALA LUMPUR: Malaysia-based multinational conglomerate, Sime Darby Bhd, plans to almost double its market capitalisation to RM100bil on Bursa Malaysia by 2016 from RM57.73bil recorded to date.

In line with the five-year strategy blueprint for financial year 2012 until 2016, Sime Darby would continue to expand and strengthen its position in diversified business activities such as plantation, industrial, motor, property and energy and utilities.
Executive Vice-President Group Strategy and Business Development Alan Hamzah Sendut said from the financial perspective, the company has recorded a lower financial result due to volatility in global commodity prices.

Sime Darby’s profit before interest and tax for the nine-month period ended Mar 31, 2014 slipped 16% to RM2.922bil from RM3.478bil recorded in the same period last year.

“However, our production (palm oil) is increasing, and volatility in the crude palm oil prices is beyond our control,” he told reporters on the sidelines of Invest Malaysia 2014.

Alan also said the company has outlined strategic thrusts for each of the division under the group.

“For the plantation division, we will be looking at land bank expansion. We are looking for opportunities to acquire land outside Malaysia,” he added.

Sime Darby Bhd registered a pre-tax profit of RM1bil in its third quarter ended March 31, 2014 compared with RM934.74mil registered in the same period a year earlier.

The group, however, posted a lower revenue of RM10.295bil for the quarter compared with RM10.84bil in the same period last year, while earnings per share was higher at 14.09 sen against 11.5 sen previously.

The conglomerate attributed the quarter’s higher profit to improved results from the plantation division and a lower effective tax rate. – Bernama
Read more at http://www.thestar.com.my/business/business-news/2014/06/09/sime-darby-seeks-to-almost-double-market-cap-to-rm100-bln-by-2016/#IdHplLtjU7BjC7vR.99

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The global financial crisis hitting at the end of 2014 and all throughout 2015 set the target back. In all, market cap of company listed in Bursa Malaysia saw an unprecedented reduction in value, despite the fundamentals such as operations and NTA are still encouraging.

Needless, this corporate move is extending the expansion of the Bumiputra Economic Agenda as part of the nation’s high income economy, which Prime Minister Dato’ Sri Mohd. Najib Tun Razak first assured the Malays in 2013.

It is a good start for the year of the Fire Cock.

Published in: on January 31, 2017 at 03:01  Comments (1)  

Recklessly leaky

The flavour of the week is about financial crisis and scandals during Faust of ‘Flip-Flop’ Tun Dr Mahathir’s administration as Fourth Prime Minister, surfacing in various form and template and opening up more ambiguity to the Malaysia public, particularly the Millennials.

NST online story:

‘Actual losses were more than the ones reported by central bank’

 

27 JANUARY 2017 @ 10:56 AM

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The following are excerpts from a question-and-answer session with former Bank Negara Malaysia (BNM) assistant governor Datuk Abdul Murad Khalid. Murad, who resigned from BNM on Feb 1, 1999, was the manager of the central bank’s banking department (between April 1992 and March 1994) and was its bank regulation department manager (April 1988-March 1992).

During his tenure with BNM, Murad was involved in the investigation into Sime Bank. He took over BNM’s foreign exchange operations in late 1992 after the central bank incurred paper losses of more than RM9 billion, in that financial year.

He was also made the central bank’s representative in the Oversight Committee of Pengurusan Danaharta Nasional Bhd and director of Danamodal Nasional Bhd.

Question: What were the total losses incurred by BNM in foreign exchange (forex) during that period?

Answer: The total losses were US$10 billion and not ringgit. Our losses were in foreign currencies. It means that our reserves in US dollar, pound and yen all went down the drain. We lost them just like that. This (amount) was accumulated losses over several years. Over the years, we discovered and closed the book in 1994, and recognised all the losses. The total losses depends (on the exchange rate). It would become RM44 billion if you convert it based on the present exchange rate. The exchange rate was between RM2.3 and RM2.5 for US$1 at that time.

Q: What were the causes?

A: There was no control. No internal control and nobody knew what was happening at that time. It was real money. As if we lost the money that we had in our pocket. For example, if you buy Tenaga Nasional Bhd shares at RM10 (per unit), a week later, you will have to pay. Tomorrow, (if) it falls to RM7, you will have to pay the difference if you sell it. They kept on rolling over the contract.

Q: When was the bulk of the losses recorded?

A: I think from 1991 to 1993. I’m not sure (if Datuk Seri) Anwar (Ibrahim) was involved. I cannot say that (the then prime minister) knew about it as I was not involved in the top management (meetings) between the minister and governor. I didn’t know what happened.

Q: Who was responsible? Would you name them?

A: No, I would not name them. The most important thing is there was no investigation at all. You lost US$10 billion, but there was no investigation. The police or the Anti-Corruption Agency (now the Malaysian Anti-Corruption Commission) did not come. No one came to investigate.

Q: In your knowledge, did anyone lodge a report with the ACA?

A: It was highlighted in the newspapers. The stories were big and (nothing was done), even after the governors have changed several times.

Q: Did the Public Accounts Committee (PAC) investigate the case?

A: PAC only called (us) and asked us as a group from BNM. That’s all.

Q: It was reported as losses in the BNM report… didn’t the then prime minister know about it?

A: I’m sure the governor briefed them. Because the transactions were so big, you cannot unwind them in one day as it would take months to unwind. It involved mainly major currencies, such as the US dollar and Deutsche mark, as they didn’t have euro at that time, yen and pound.

Q: At the bank level, was any action taken against the dealers?

A: No. It was not their (the dealers’) decision. They only executed, but were not (involved) in the decision-making. I don’t know how it could happen as it was not the role of BNM to speculate.

Q: Was it a pure business decision or were there other things that motivated them?

A: I cannot say for sure. It’s possible (that they did it to make a lot of money). For example, in 10 transactions, if you can make profit from one, then that is possible (to make money).

Q: Is it only on paper or real losses?

A: It was real losses. Real money was involved. Our money from our reserves. As I told you earlier, if you have a bank account and you have lost some profits, you have to issue a cheque to pay. It’s the same. Very simple analogy there. It’s not the role of BNM to speculate. It should only intervene to smoothen the movement of the ringgit.

Q: Normally, the government will charge those involved and retrieve the funds… in this case?

A: No. And it’s up to the government as the case occurred more than 20 years ago. I will tell you what I know, but the most important thing is to ensure that the records are still there.

Q: Is it the biggest loss in our history?

A: Not only in Malaysian history, but in the world for forex losses. Even the Nick Leeson case (whose fraudulent, unauthorised speculative trading caused the collapse of Barings Bank) is small. US$10 billion is not a small amount. It was quoted as RM9 billion in the Bank Negara 1992 Annual Report. But, the total accumulated amount is much more than that.

Q: Do you have proof to support your claim that the actual loss was US$10 billion?

A: You can go to BNM and look at its accounts in that few years. The RM9 billion, or US$4 billion, was only recognised by BNM for 1992, while the US$10 billion was accumulated from several years. The actual losses were more than the ones reported in the BNM account.

Q: Does it surprise you that the opposition did not raise the issue at that time?

A: They raised it, but there was nothing much they could do. The power is in the government’s hand.

Q: Should the authorities reopen the case?

A: They should and I’m willing to cooperate. The records are already more than 20 years old and might have been eaten by termites. The dealings were done here (in Malaysia). There are two things, one is speculation and another is reserve management . Reserve management is where you move your assets or foreign currencies, such as the US dollar to Deutsche mark. It’s a real thing and (involves) real assets if you invest in Treasury bills or government bonds. That’s the role of BNM, but what it did (at that time) was speculation. This one (forex speculation), they could be rolled over or take position. They used to call it “contra” dealing in the stock market before, but it’s actually forward trading or betting.

Q: How did it cover the losses?

A: In the BNM account, it already had RM10 billion. It (might have) used that reserves first.

Q: Is BNM the only central bank involved in “betting” in the world? A: Yes. It’s a big loss, but there is no investigation. Bigger than other cases and why there was a cover-up? The truth must prevail.

Read More : http://www.nst.com.my/news/2017/01/207665/actual-losses-were-more-ones-reported-central-bank

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For an Ex-Assistant Governor of Bank Negara Malaysia (BNM) Abdul Murad to admit the accumulated foreign exchange losses was in excess of USD10 bil in very damning. It created minus capitalisation to BNM.

USD10 bil losses to foreign exchange simply wiped 55% of BNM foreign reserve, which is RM18 bil.

The losses saw the untimely departure of Governor Tan Sri Jaafar Hussein. However, no one in the Malaysian Government took to fall for this economically hazardous gamble.

Asst Governor Murad’s revelation is adding the public curiosity, to the Pandora’s Box which was opened earlier in the week upon the Asian Correspondent story about CIA files on the BMF scandal being declassified.

*Updated 2100hrs

Prime Minister Dato’ Sri Mohd. Najib Tun Razak reacted that BNM views on Assistant Governor Murad’s revelation would be sought by Cabinet before any further action be taken.

Bernama story:

Cabinet seeks BNM’s views on alleged foreign exchange loss: Najib

Posted on 27 January 2017 – 07:37pm

Umno president Datuk Seri Najib Abdul Razak during a media conference after chairing the party’s Supreme Council meeting at Menara Dato Onn, Putra World Trade Centre on Jan 27, 2017. — Bernama
KUALA LUMPUR: The Cabinet will seek the opinion of Bank Negara Malaysia (BNM) on the alleged foreign exchange losses of US$10 billion in the early 1990’s before taking any further action.

Prime Minister Datuk Seri Najib Abdul Razak said the government took a serious view on the matter.

“However, other members of the administration and I need to get the opinion and comments of BNM and other parties. Later, the Cabinet will make a decision on the matter,” he said.

Najib, who is also UMNO President, said this to reporters after chairing the UMNO Supreme Council meeting, here today.

Former BNM Assistant Governor Datuk Abdul Murad Khalid was reported to have said that the central bank suffered foreign exchange losses of US$10 billion in the early 1990’s.

BNM said in a statement replying to the allegation that the institution had achieved progress that was stronger, more transparent and responsible since the foreign exchange losses occurred almost 25 years ago. — Bernama

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Published in: on January 27, 2017 at 11:00  Comments (5)  

Dr M ‘Flip-Flopped’ & running with tail behind his hind legs on Najib’s initiative for the rakyat

Fourth Prime Minister Tun Dr Mahathir Mohamad ‘Flip-Flopped’ on his opposition against BR1M, an initiative introduced by Prime Minister Dato’ Sri Mohd. Najib Tun Razak as direct subsistence for the B40 five years ago, during the launch of Parti Pribumi Bersatu Malaysia tonight.

The Malay Mail Online:

Dr M says would abolish GST, make BR1M statutory

BY IDA LIM

Saturday January 14, 2017
11:05 PM GMT+8
SHAH ALAM, Jan 14 — The federal opposition will gradually repeal the controversial Goods and Services Tax (GST) if it is elected into power, Tun Dr Mahathir Mohamad said today.

Although previously calling the 1Malaysia People’s Aid (BR1M) “bribery”, the former prime minister and chairman of Parti Pribumi Malaysia also said a Pakatan Harapan government would convert the cash handouts into statutory aid.

“GST will be abolished gradually and replaced with a sales tax according to the people’s will,” he said in his speech at PPBM’s launch here, without elaborating further.

Even before he could finish his remark on the GST’s abolishment, the red-clad crowd erupted into loud cheers of “Hidup Tun!” (long live Tun) as soon as they heard the word “abolished”.

The cheers were more subdued, however, when he repeated his words and completed his remark.

Dr Mahathir also declared that PPBM along with other opposition parties would form a “clean” government—especially in terms of elections—with various reforms to be carried out.

He said this new government would ensure that no bribes would be given out in any form to voters to gain support during elections.

“If it is found that BR1M is important, then this money will be distributed by government servants. BR1M cannot be included in any party’s’ manifesto.

“If it is agreed by the people, BR1M will become a statutory aid that is determined by laws and ordinary budget. The prime minister cannot determine its distribution or the amount, or the way it is given,” he added.

– See more at: http://www.themalaymailonline.com/malaysia/article/dr-m-says-would-abolish-gst-make-br1m-statutory#sthash.6xlrxFzg.dpuf

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Bantuan Rakyat 1 Malaysia (BR1M) was first introduced in 2012 as subsistence direct to the target group, which is the B40, upon Federal Government’s rationalisation and reform on subsidies and economic transformation program. It was an idea mooted by Bank Negara, during the days of ‘laboratories’ created when Prime Minister Najib’s administration was preparing on new policies and economic and government transformation in 2010.

The program, now is categorised by different group of recepients.

Dr Mahathir attacked BR1M as a form of ‘bribe’ by Prime Minister Najib, to get the B40 supporting BN.

Inadvertently, Dr Mahathir acknowledged the transformation that has been introduced by Prime Minister Najib did brought positive effect for the rakyat. And now, he wants BR1M to be tweaked into statutory.

The fact is that he is running out of issues to rubbish Prime Minister Najib, considering many of the latter’s policies and strategic initiatives have brought positive result which the rakyat has been benefitting.

How his Opposition ‘Barisan Rakyat’ would try to mitigate the grave short fall in Federal Government coffer for operating budget by RM40 billion plus per annum by abolishing the consumption tax is not clear at this time. It is doubtful that it could be supplemented even if the Opposition whipped up IRB, Royal Customs and Local Authorities to generate RM40 billion plus that is collected annually under GST.

So far consumption tax in the form of GST is the fairest system of collecting revenue from the rakyat’s consumption of goods and services, without imposing higher personal income tax or any introduction of new taxes.

Globally, consumption tax has been proven to work in most economies, be it modern and developed or the struggling under-developed ones.

Published in: on January 14, 2017 at 23:59  Comments (9)  

The economy going bankrupt and failing state indicators

There are some really skewed personalities with sinister agenda going around trying to convince the gullibles and ill-informed in their strategy to oust the current Prime Minister Dato’ Sri Mohd. Najib Tun Razak, why bold lies like “The nation is going to be bankrupt” and ‘The economy is failing”. However, the reality is quite the opposite.

The Star story:

Thursday, 12 January 2017 | MYT 4:33 PM

Mercedes-Benz M’sia’s sales hit record in 2016

KUALA LUMPUR: Mercedes-Benz Malaysia (MBM) posted an all-time record sales of 11,779 units in 2016, up 9% from 10,845 units sold in the previous year.

MBM president and chief executive officer Dr Claus Weidner said Mercedes-Benz continued to be the number one premium car brand locally with a 2.4% market share and hoped to retain its pole position in 2017.

“2016 was an exceptional year in the history of MBM. We achieved a tremendous milestone as we contributed towards the global success of Mercedes-Benz, which set a new record with double-digit growth of 11.3% and over two million vehicles sold worldwide.

“We are working hard to sustain our success here in Malaysia,” he told a media briefing on the group’s 2016 performance in Kuala Lumpur on Thursday.

MBM’s record-breaking performance came as demand for Mercedes-Benz vehicles in the Asia-Pacific region achieved a new high, increasing by 19.3% compared to 2015 which totalled 734,109 vehicles delivered to customers.

Malaysia was listed as a contributor to this best in history growth along with other leading Asia Pacific countries, namely Japan (+3.5%), South Korea (+25%), Australia (+14.8%) and Taiwan (+17.4%).

Amid the challenging economy, Weidner said MBM’s strategy of prioritising customer service had paid off and kept its sales performance at a steady pace throughout 2016.

He said MBM’s production plant in Pekan, Pahang, produced 7,882 vehicles last year, recording a growth of 2.2% from the previous year.

He said the group also offered a comprehensive financing at 1.88% and has a loan portfolio of RM1.8bil currently, with four out of every 10 vehicles sold being financed and insured by its sister company, Mercedes-Benz Services Malaysia.

“MBM will continue to invest in dealer network, upgrade facilities and up skill its manpower in Malaysia,” he added.

Meanwhile, MBM vice president (sales and marketing) Mark Raine said the company hoped to register another stellar performance in 2017, banking on new model launches expected this year together with the 17 models launched last year.

On the impact of weak ringgit on car sales and pricing, he said MBM would continue to monitor all influencing factors, but as of now, it had no plans to increase the prices of its vehicles. – Bernama

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The record sales of the German automobile is a very good indicator the upper middle class have spare cash to splurge. That is up and above that their faith of the economy is strong and it is going concern, for their firms to continue operating with foreseeable profits and healthy cashflow to undertake such luxurious acquisitions.

Other services catered for the upper middle class such as fine and gourmet dining, 5star and above accommodations have started to strongly present their demands. This include private and leased jet and charter services.

Otherwise, they would have taken measures like conserving the utility of resources and safeguarding assets, especially cash and securing financial commitments.

How about the bulk lower middle class. This is the group which is said to be making the most noise, affected by the so called “Intolerable increasing cost of living” and coupled by the urban-lower middle middle income trap.

The liquidity amongst them is very supportive of the retail and local economy, which is reflective in the strengthening nation’s favourite family restaurant, which is seeking listing in Bursa Malaysia again.

The Star story:

Thursday, 5 January 2017 | MYT 5:01 PM

QSR Brands to open 30 more KFC outlets this year

KUALA LUMPUR: QSR Brands (M) Holdings Sdn Bhd (QSR Brands) is planning to expand its KFC business by adding up to 30 new outlets nationwide this year.

Chandrasagran Munusamy, general manager for KFC operations at QSR Brands unit QSR Stores Sdn Bhd, said the expansion would materialise with or without the relisting of KFC or QSR Brands on the local bourse this year as speculated.

He said funding for KFC’s expansion in Malaysia was not an issue and was not the main reason for the relisting.

“Thirty outlets were opened last year without any funding issue and to-date we have a franchisee of 665 KFC outlets nationwide.

“Malaysia has great potential and we want to open 20 to 30 more outlets this year in areas that we have identified,” he said after launching the new KFC Cheezy Mushroom Crunch in Kuala Lumpur on Thursday.

Chandrasagran said the cost of opening a new outlet would vary between RM1mil and RM4mil depending on whether it would be a drive-thru restaurant, a shoplot restaurant or one in a shopping complex.

It was reported recently that the fast-food franchise brand was returning to Bursa Malaysia after being taken private in 2013 by CVC Capital Partners, Employees Provident Fund and Johor Corp.

The relisting is expected take place this year with its initial public offering capable of raising up to RM2bil.

“The funds from relisting will cover many areas, not necessarily for the KFC expansion plan only. The management is working on it now, however, nothing much has been finalised,” Chandrasagran said, adding that he projected another incremental sales growth for KFC Malaysia this year.

QSR Brands, which currently holds a franchisee of over 750 KFC restaurants in Malaysia, Singapore, Brunei and Cambodia, is also the operator of Pizza Hut in Malaysia (370 outlets) and Singapore (75 outlets).

Meanwhile, senior general manager for KFC marketing Angelina Villanueva said despite the bleak economic outlook, the food and beverage industry was very competitive nowadays.

“The demand for KFC in the country is intact and KFC Malaysia is doing well in terms of sales.

“For the new KFC Cheezy Mushroom Crunch product, we are looking at 15% contribution to the overall revenue. We hope 2017 will be another good year,” she said. – Bernama

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The fact is that for QSR to maintain 750 outlets all over the region and still making money (bulk of the outlets are in Malaysia), it is reflective of  the market’s liquidity and propensity to spend.

The liquidity amongst the upper lover 40% and lower middle class is also reflective the strong support for of a local kopitiam chain seeking IPO.

The Malay Mail Online:

Malaysian restaurant chain PappaRich said to mull Singapore IPO

Thursday January 12, 2017
04:59 PM GMT+8
KUALA LUMPUR, Jan 12 — PappaRich Malaysia Sdn., a food chain selling local cuisine from nasi lemak to curry laksa noodles, is considering a Singapore initial public offering, people with knowledge of the matter said.

The company, which opened its first restaurant in Malaysia in 2006, is targeting to achieve a valuation of at least S$200 million (RM892 million) in the share sale, according to the people. It aims to conduct the offering as soon as this year, one of the people said.

Any deal would add to a rebound in the Singapore IPO market last year, when fundraising surged more than fourfold to US$1.7 billion (RM7.58 billion), data compiled by Bloomberg show. PappaRich would follow other Southeast Asia-based restaurant chains including ABR Holdings Ltd., which operates Swensen’s ice cream parlors, and Oldtown Bhd in gaining a listing to fund expansion.

A representative for PappaRich, which is based near Kuala Lumpur, said a listing has always been a consideration as the company considers fundraising options to support its expansion plans. PappaRich “would certainly” expect to have a valuation in excess of S$200 million upon listing, based on comparable businesses, he said.

Oldtown, which makes instant coffee and runs cafes, has risen 18 per cent in Kuala Lumpur trading over the past 12 months. Shares of Thai dessert chain After You Pcl, which raised US$21 million in a Bangkok IPO last month, have surged 167 per cent from their offer price.

More than 1 million customers dine at the PappaRich outlets monthly, according to its website. The company has about 100 outlets globally including locations in Malaysia, Singapore, China, Australia, New Zealand and the US, the website shows. — Bloomberg

– See more at: http://www.themalaymailonline.com/money/article/malaysian-restaurant-chain-papparich-said-to-mull-singapore-ipo#sthash.ImuUYOr8.dpuf

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More on the strategic front, initiatives are being made and strengthening the position of Malaysia two become another global shariah compliant fund hub.

Thursday, 12 January 2017 | MYT 1:33 PM

Malaysia launches 5-year Islamic fund, wealth management blueprint

KUALA LUMPUR: Malaysia has launched a five-year Islamic Fund and Wealth Management Blueprint to further strengthen the country’s position as a global hub for Islamic funds by 2021.

The plan, the first of its kind globally, is also aimed at developing the country as an international provider of Islamic wealth management services.

It was launched by Second Finance Minister Datuk Johari Abdul Ghani at the International Fund Forum 2017 in Kuala Lumpur on Thursday.

The 51-page blueprint comprises three strategic thrusts, namely, strengthen Malaysia’s position as a global hub for Islamic funds, establish the country as a regional centre for shariah-compliant sustainable and responsible investment, and develop it as an international provider of Islamic wealth management services.

“The Islamic wealth management industry is still at a nascent stage of development as compared with other segments of the Islamic capital market.

“Malaysia, with its comprehensive Islamic finance ecosystem and track record in innovation, is at an advantageous position to play a lead role in shaping the concept and driving the development of Islamic wealth management services,” the blueprint highlighted.

It also outlined 11 recommendations for Malaysia to achieve the desired status by 2021, and which focus on addressing impediments to growth and innovation, while identifying potential opportunities for collaboration and partnerships, as well as accelerating the process of building scale.

The recommendations, among others, provide enabling frameworks to support innovation in Islamic markets, enhance market access and international connectivity, promote the growth of private equity, as well as spur institutional participation in Islamic funds.

It also includes facilitating new digital business models, products and services for Islamic fund and wealth management, develop facilitative market infrastructure for Islamic wealth management, and fortify talent pipeline for Islamic wealth management.

As Malaysia operationalises the blueprint, utmost attention would be given to the phased implementation of initiatives under the respective recommendations.

It is recognised that there might be further shifts that would influence the dynamics of the global and domestic marketplace, including the emergence of new factors.

Therefore, the recommendations are designed to provide sufficient flexibility within the overall objective of the blueprint to enable appropriate adjustments and realignment in such situations. – Bernama

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It is ashamed there are professionals and the educated lot amongst us who are taken in with these proposterous notion that the nation is heading towards bankruptcy out of sheer lame political rhetorics, simply to demonstrate their political agenda is out of steam but still continue hitting multiple layer of brickwalls.

At the strategic level, limited layers dwell into markets in Malaysia as an open economy and its open for business. Business activities comes with sorts of commercial papers being traded and exchanged fr assets against debts, where shareholders plan their portfolio based on trends and strength of specific sector.

Published in: on January 12, 2017 at 20:15  Comments (1)  

Lesson from Trumphiancy: Charity begins at home

Despite short of overwhelming popular votes in recently concluded presidential elections to vote the 45th president of the most prolific democracy and champion of the ‘New World Order’, Middle America boldly told the political establishment off that they wanted attention and their requirements be served up above other interests and agenda of for the rest of the world, including position and values of the minorities within ‘Home of the Free’ and ‘Land of the Brave’.

The Straits Times story:

US elections: Malaysian PM Najib says Donald Trump appealed to Americans who want less foreign interference

 Malaysian Prime Minister Najib Razak has congratulated US President-elect Donald Trump on his election win.

 

PUBLISHEDNOV 9, 2016, 4:24 PM SGT

KUALA LUMPUR (REUTERS) – Malaysian Prime Minister Najib Razak congratulated United States President-elect Donald Trump on Wednesday (Nov 9), saying the Republican victor had appealed to Americans who wanted to see the United States less embroiled in intervention abroad.
“His appeal to Americans who have been left behind – those who want to see their government more focused on their interests and welfare, and less embroiled in foreign interventions that proved to be against US interests – have won Mr Trump the White House,” Datuk Seri Najib said in a statement.
Mr Najib said he looked forward to continuing a partnership with the United States under Mr Trump’s presidency.

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This is true because US foreign policy the past eight years of Obama administration, spent too much on international issues which include the change of several regimes mainly in the North African and West Asian region, more commonly known as ‘Arab Spring’.

United States supported resistance and separatists in countries like Syria, Kurdish, Yemen, Ukraine.

The Obama administration earlier intended to reduce and withdraw armed troops in Afghanistan but instead committed more resources. So was the promise to shut Guantanamo Bay and resolve the hundreds of multinational detainees being jailed without trial.

Right almost ending his first term, President Obama launched a special forces military incursion attack from Afghanistan and assassinated the world most wanted terrorist Osama Ben Laden.

When Hillary Clinton was the Secretary of State and she was in Malaysia fir official visit, she made a point about allowing then Opposition Leader Anwar Ibrahim some room to discourse, despite the latter was then still in a serious criminal case which still in trial.

During President Barack H Obama’s official visit to Malaysia, part of his itinerary is to have an audience with Opposition Leaders and civil liberty activists. That should not be viewed as anythimg but dipping America’s Super Power hand into domestic affairs, especially when the case brought forth was criminal and anti-Constutional in nature.

Closer to home front, Prime Minister Dato’ Sri Mohd. Najib Tun Razak opined that the outgoing administration was not too comprehensive in their outlook for the majority of Americans, thus after eight years of Democrat control via Obama administration, they had enough.

The Straits Times story:

US elections: Malaysia’s Najib says Trump appeals to those left behind

Malaysian Prime Minister Najib Razak said that Donald Trump won the White House because of his “appeal to Americans who have been left behind”.PHOTO: EPA
PUBLISHEDNOV 9, 2016, 8:46 PM SGT

Trinna LeongMalaysia Correspondent
Malaysian Prime Minister Najib Razak has lauded Mr Donald Trump’s victory today, saying what happened showed that “politicians should never take voters for granted”.

“His appeal to Americans who have been left behind – those who want to see their government more focused on their interests and welfare, and less embroiled in foreign interventions that proved to be against US interests – have won Mr Trump the White House”, Datuk Seri Najib said in a statement.

His comments on focusing on the interest and welfare of those “left behind” echoed what he said at the unveiling of Malaysia’s 2017 Budget when he handed out a slew of cash, grants and aid to what he called the country’s B40 group – the bottom 40 per cent of Malaysians.

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Let the mighty United States have a reflection on themselves first upon the change of guard coming up 20 January 2017. The Brit gad theirs right after World War Two ended and they quickly decided maintaining control and cloud of the British Empire, which simply translate to 1/3 of the planet is something they cannot afford to do any longer.

So what ever resources left available to Trump come January, should be channeled for the social and economic development strategy and agenda of the Middle America first.

Published in: on November 11, 2016 at 00:15  Leave a Comment  

Preserving the Brand

The decision makers of the Malaysia GP namely Ministry of Finance, Sepang International Circuit and Youth and Sports Ministry (KBS) should consider the preservation of the Brand, particularly the world FIA champion unchalleged for several seasons Mercedes AMG Petronas F1 Team which is synonymous with SIC as its home.

NST story:

Khairy: Malaysia should ‘take a break’ from hosting F1 race

BY NST ONLINE – 24 OCTOBER 2016 @ 8:53 PM

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KUALA LUMPUR: Youth and Sports Minister Khairy Jamaluddin today expressed his support for a temporary halt to Malaysia hosting the Formula 1 races.

Addressing the matter via his Twitter handle @Khairykj, the minister said there were many compelling factors to support the idea, including high costs and limited returns. He said that when Malaysia first began hosting the F1 races in 1999, it was the first Asian country outside of Japan to do so.

“Now, there are so many venues. There is no first-mover advantage; it’s no longer a novelty,” he said. Khairy cited reasons such as declining ticket sales and TV viewership figures, as well as foreign visitors now having the option of seeing the races in Singapore, China and the Middle East.

His comments came in the wake of the revelation by Sepang International Circuit (SIC) chief executive officer Datuk Ahmad Razlan Ahmad Razali today, who said SIC is mulling the future of the race in Malaysia. Razlan had said that a special meeting would be held this week with SIC’s major stakeholder, the Finance Ministry, with regards to the future of the sporting event in Malaysia.

He said consistently declining F1 ticket sales and TV viewership figures were among the factors behind the move.

Meanwhile, Khairy engaged Twitter users on the subject, and fielded questions. He said SIC should bid for less costly races, like the Japan GT, in response to a query on what can be done to avoid turning the Sepang circuit into a ‘white elephant.’

On a question as to why the Singapore Grand Prix had in contrast enjoyed success, Khairy said the Singapore leg benefited from its novelty factor. “It’s a night race in the city (which is done) no where else in the world. Even then, (their) ticket sales are down,” he said.

Khairy maintained that Malaysia should continue to host the MotoGP, which has maintained a sellout crowd. The Moto 2 and Moto 3 races, he said, also has the added boost of having Malaysian riders.

The minister said SIC could instead also spend more on development and increase public access to track days. “Local racers such as Jazeman Jaafar, Nabil Jeffri and Akash Nandy are having a tough time getting sponsors.

A fraction of the F1 hosting fee can help them and more,” he said. Jazeman is a driver with HTP Motorsports in the Blancpain GT Series and the Intercontinental GT Challenge. Nabil Jeffri races for Arden Motorsport in GP2.

Read More : http://www.nst.com.my/news/2016/10/183085/khairy-malaysia-should-take-break-hosting-f1-race

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The comment from the concession holder and local operator of Malaysia GP argues that since Mercedes AMG Pertonas has been ‘monopolising’ the entire season of the FIA F1 circuit globally for a few season as overall champions, it has digressed on exciting for fans and TV viewers world wide.

Event in Malaysia, ticket sales have been dwindling down through the years. Also tv viewership.

In Singapore, where the city-state is offering the only night race in the 20 race circuit worldwide, is suffering the same symptoms.

It is unwise to sacrifice commercial takings at the expense pf branding when Petronas is synonymous with the Mercedes AMG Petronas team and SIC is their home turf.

It is like Italian GP at Monza, home of the Scuderia Ferrari F! team where the team is synonymous with Santander and Shell are two title partner sponsors.

Malaysia, through KBS, should find ways to strategically capitalise and optimise on the branding on Mercedes AMG Petronas F1 team and SIC, for the nation.

screen-shot-2016-10-25-at-4-18-09-am

Maybe other global renown brands like Mutiara Crowne Hotel, Danna or even Pelangi, national carrier Malaysia Airlines and globally renown banking group Maybank, to come together and lend the strength of joint-co-branding for generating a new hype of interests amongst the motor sports enthusiasts, high net worth individuals and targeted corporations to commit into the Malaysia GP for the net three years.

The ability to continuously hype the attention on Malaysia as a high technology motorsports itinerary would also be beneficial if and when Lotus is ready to introduce their products, easier planned by 2018-2020. This will complement the industry.

Branding is a powerful tool. Minister Khairy Jamaluddin should be able to distinguish the merits of brands that are already riding high on the top without a real challenger, which should be optimise to the fullest all his strategic programs of ‘Fit Malaysia – the high-octane segment and capitalise on it.

After all, for Malaysia GP Tan Sri Mokhzani Mahathir considered of installing lighting facility all over at the GP track for the Malaysia GP could be race at night, it a proper built motorcading circuiting,

Giving it up  now where the figures are dwindling isn’t enthusiastic ways of marking up an mark, on a turf to be repackaged into greater heights, mainly on the consideration of lowered ticket sales.

Published in: on October 25, 2016 at 00:30  Leave a Comment  

Going concern economy

Malaysia is open for business and the facts are scientific evidence that the nation’s economy is healthy and regardless what detractors tried to manipulate and lie about it. Hence, it is going concern.

We would like to share a comment that one of our regulars here in this blog pertaining to Fourth Prime Minister Tun Dr. Mahathir Mohamad of “Failed economy”, shared in the last posting.

PM Najib’s performance in managing the economy in the first seven years of premiership is rather impressive, even taking Dr Mahathir’s first seven years’ performance.
It is a fact that Najib’s transformation policies did bring about steady reduction of annual budget deficit.
Comparatively to Dr Mahathir’s time his first budget saw a 16.3% deficit. six years later was brought down to -7.5%.
When he first started, the Malaysian Govt debt is 54% of GDP. Within six years, it shot up to 103.4% of GDP. 62% of that public debt was in foreign currency.
That simply translate Dr Mahathir borrowed 64% of GDP from foreigners.
Foreign reserves than was only at USD6billion. There was a minus current account. Then again, in Dr Mahathir’s first year as PM, the current account was at -13.4%.
How could the economy today is a “Failed state”?
There are more people working. The BOP in the current account is good. The unemployment rate is a little over 3%. It simply means those who are unemployed is by choice.

Income per capita is all time high.
Even market capitalisation of Bursa Malaysia is RM1.8 trillion. The foreign reserve is a healthy near USD100b.

The Malaysian economy is on-going concern. It’s evidently clear.

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Malaysia was never a ‘Failed Economy’ then despite the ghastly figures. The fact is that, Malaysia is a going concern state.

The global rating agencies in the likes of Fitch, Moody’s and Standard and Poor issue very encouraging rating scores for the Malaysian economy.

It is organic. It is industrious. The people are productive and there  raw materials to work on and goods to produce.

Thus, the industrialisation grew and more and more exports are generated year on year. When economic activity grew, the support system also would naturally grew.

This include banking and other services, like food and beverage and other ancillary services.

Economic activity also promotes more demand for transportation, energy and above all, infrastructure.

Naturally as the population grow, the demand for dwellings increase as well. The trickle effect is endless.

If comparable against present day, the economic vital statistics is even much better. There fundamentals are strong and the economic base is very solid.

Therefore, the confidence on the principle of ‘going concern’ should be higher.

However, there are some rogue personalities who are trying to frighten the majority with the ghost stories about the economy is sick and the nation slow is failing.

To the majority, they are unable to decipher even basic economic data. Along with rising cost of living, they are easily bought over.

The fact, many ordinary people are not putting the measurement ruler to the right pole. They simply simplify everything with a common viewing glass.

With the exception of unaffordable homes in the major metropolitan, everything else should be in the right context of affordability.

A quick example is a car. The same car with equivalent specifications today is actually cheaper than what it was ten years ago. If adjusted to the purchase power parity, then the affordability of a common car is accessible to all.

This is true considering that more and more cars are being sold and even to group of consumers previously, are unable to have access to such goods at their current state.

More and more Malaysians are travelling and taking holidays, regionally and even further abroad.

Published in: on October 21, 2016 at 10:00  Comments (2)  

Sound Fiscal Management

Malaysian Federal Government had been having sound fiscal management since Merdeka, considering that economic growth had been steadily achieved which is reflective in the rakyat socio economic stature and quality of life, without the need to issuing USD17.5 billion in a single tranche of sovereign bond to raise money.

Financial Times story:

First Saudi bond sale raises $17.5bn in emerging market record

Debt issue part of a broader plan to shift economy away from its reliance on oil
Read next:
Saudi Arabia to sell up to $17.5bn in debut issue
YESTERDAY

© Bloomberg

YESTERDAY by: Elaine Moore in London and Simeon Kerr in Dubai
Saudi Arabia has raised $17.5bn for its debut sovereign bond issue, eclipsing Argentina’s bond sale earlier this year to become the largest debt issue by an emerging economy.
Investors put up orders of $67bn, enabling the kingdom to increase the amount borrowed and overtake the $16.5bn raised by Argentina as buyers queued up in search of yield.

“This is clearly a success for the country,” said Richard House, head of emerging markets fixed income at Standard Life Investments.

Saudi Arabia’s entrance into international markets is part of a broader plan to pivot the country’s economy away from its reliance on oil, as prices slump to half the level of two years ago. The sale is expected to herald a pipeline of new deals, including the world’s biggest initial public offering from state oil company Aramco.

“This is very significant moment for the kingdom — until this year it had not held external sovereign debt,” said Monica Malik, chief economist at Abu Dhabi Commercial Bank. “They had to issue, given tight domestic liquidity conditions and stretched local funding sources, and we expect to see further issuance going forward — Saudi will become a fixture on global debt markets.”

The multibillion-dollar order book reflected heightened demand for debt issued by emerging markets this year, as interest rates in the developed world remain at historic lows. Argentina, Qatar, Turkey and Mexico have all sold large bond issues and the demand allowed Saudi Arabia to tighten prices. The sale comprised three maturities of five, 10 and 30 years offered at yields of about 2.60 per cent, 3.41 per cent and 4.63 per cent, respectively — slightly below expectations.

“Saudi is an attractive investment, but to be honest nearly every emerging market bond has been a success this year — investors are still desperate for yield,” said Mr House.

According to one investor, Asian buyers were responsible for a significant portion of orders, with investors such as pension funds and insurance companies known to be interested in buying the country’s long-dated bonds.

One investor said the issue was priced at a reasonable level, and would encourage interest in future expected bonds. “Saudi is just one big oil company, right, so there will be managers switching out some of their exposure to get the yield of the Saudi bond,” he said.

The bonds were sold around 40 basis points above debt issued by neighbouring Qatar, which carries a higher credit rating, and around 100 basis point wider than bonds sold by oil companies BP and Shell.

Saudi Arabia would have to embrace a new era of greater transparency as investors pore over its fiscal position and reform programme, he added.

“Bondholders will want to see that Saudi Arabia is continuing its fiscal consolidation — they won’t only want to see debt levels going up,” said Ms Malik.

Saudi Arabia’s economy is forecast to slow this year as oil prices remain low and the country engages in a costly war in Yemen, with the International Monetary Fund forecasting gross domestic product growth of 1.2 per cent this year from 3.5 per cent in 2015.

Related article

IMF cuts Saudi Arabia 2016 growth forecast as oil price stays low
Overall expansion of 1.2% lowest since 2009 as spending cuts hit non-oil sector
The IMF has welcomed the government’s Vision 2030 plan, which seeks to crimp spending, raise new non-oil revenue streams and bolster the private sector.

“This issue is important as Saudi Arabia will be in the market for a number of years, so they need to lay out a predictable plan of where they are going,” said Masood Ahmed, the IMF’s managing director for the Middle East, said in Dubai on Wednesday.

“And they need a credible fiscal consolidation plan — they need to show that they have a plan to bring down their financing needs.

In its pitch to prospective bond investors, Saudi Arabia’s Ministry of Finance acknowledged the damage caused to its economy by falling oil prices, which led the government to resume issuing local currency-denominated bonds last year for the first time in almost a decade.

The kingdom faces a budget deficit of 13 per cent of gross domestic product this year, below last year’s 16 per cent deficit, as spending cuts move from capital projects to public sector wage bill. Next year, the deficit is forecast to fall to 9.5 per cent.

Government debt, now at 5 per cent of GDP, is forecast to reach 20 per cent by 2017 as the state relies on borrowing rather than financial reserves to plug the shortfall.

Although oil prices have recovered from the decade-low of less than $30, they have struggled to sustain a rise above $50 per barrel.

Speaking at the Oil & Money energy conference in London on Wednesday, Saudi Arabia’s energy minister Khalid al Falih said the oil market had come to the end of a downturn, and that the time was now right to tighten supplies and raise prices.

Citi, HSBC and JPMorgan led the sale of debt on Wednesday, with Bank of China, BNP Paribas, Deutsche Bank, Goldman Sachs, Morgan Stanley, Mitsubishi UFJ, and NCB Capital also involved in the issue.

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The expected 1.2% growth of the Saudi economy for the year is attributable for the kingdom heavy reliance on the oil and gas industry and the sluggish global market for almost two years has taken a toll even for Saudi.

The expected budget deficit of 13% of Saudi GDP for the year (compared to 16% for the last year) is rather alarming.

The Malaysian Federal Government 2016 budget deficit is 3.1% of GDP. When Prime Minister Dato’ Sri Mohd. Najib Tun Razak took over the reins of the nation in the midst of the global financial crisis pertaining to subprime financial scandal in the West, the Bajet 2010 Federal Government deficit against GDP is 5..2%.

By comparison, the Malaysian Federal Government external borrowings is RM210 billion. That was accumulated through time, with many socio-economic development programs and projects have been successfully managed to be generated from these borrowings.

Of that, RM199.5 billion is in bond.

This is the Bernama online summary on what to expect from this Friday, when Bajet 2017 is tabled in Dewan Rakyat.

Bajet 2017 Akan Mencergaskan Ekonomi Malaysia

Beberapa tingkat di bangunan Kementerian Kewangan masih bercahaya berikutan pasukan bajet dan warga kerja bertungkus lumus bekerja lebih masa bagi menyiapkan laporan Bajet 2017 yang akan dibentangkan Perdana Menteri selaku Menteri Kewangan, Datuk Seri Najib Tun Razak di Parlimen Jumaat ini

Oleh Christine Lim

KUALA LUMPUR, (Bernama) — Bajet 2017 akan terus mencergaskan ekonomi Malaysia, walaupun dilihat sebagai yang paling mencabar bagi Perdana Menteri Datuk Seri Najib Tun Razak.

Ini sejajar dengan kedudukan ekonomi Malaysia yang terdedah kepada ketidaktentuan ekonomi dunia, dengan pertumbuhan empat peratus pada suku kedua tahun ini, merupakan tahap pengembangan paling perlahan sejak suku ketiga 2009 ketika kemuncak krisis kewangan global.

Najib membayangkan kerajaan perlu kreatif dalam menangani kekangan untuk terus menyokong kebajikan rakyat dan menyediakan seberapa banyak bantuan, dalam Bajet 2017.

Oleh itu, kebimbangan rakyat akan ditangani dengan sewajarnya.

KEWANGAN KERAJAAN

Kerajaan perlu mengurus kewangan secara berhemat, dari segi hutang dan defisit fiskal, ekoran unjuran pembayaran dividen yang lebih rendah oleh Petroliam Nasional Bhd dan kutipan cukai yang lebih rendah tahun depan.

Kerajaan juga komited mengurangkan defisit bajet kepada 3.1 peratus daripada Keluaran Dalam Negara Kasar (KDNK) tahun ini, seperti yang dibentangkan dalam pengubahsuaian bajet oleh Najib pada Januari semasa harga minyak mentah sekitar US$30 setong.

Pada harga minyak sekitar US$51 setong sekarang, ia memberikan kerajaan lebih kapasiti bagi meningkatkan perbelanjaan bajet, namun perlu berhemat memandangkan kedudukan kewangan masih dalam kedudukan sukar disebabkan ekonomi yang perlahan.

MIDF Research dalam laporannya yakin sasaran defisit 3.1 peratus itu boleh dicapai menerusi pelbagai langkah yang dilaksanakan setakat ini bagi menurunkan perbelanjaan dan melaksanakan projek pembangunan berasaskan keutamaan.

Risikonya ialah perdagangan dunia dan ekonomi terus lemah yang menjadi halangan utama kepada ekonomi Malaysia.

PERTUMBUHAN EKONOMI

Berikutan ekonomi dunia yang terus lemah, wujud tekanan dari segi import dan akaun semasa yang akan terus menjejaskan ekonomi dan usaha kerajaan Malaysia untuk meneruskan perbelanjaan pembangunan.

Ekonomi Malaysia dijangkakan tumbuh 4.0-4.5 peratus tahun ini berbanding 5.0 peratus tahun lepas, selari dengan cabaran global, antara lain, angka perdagangan dan ekonomi China yang perlahan, pasaran pekerjaan AS yang lemah, kedudukan ekonomi di zon Euro yang rapuh serta impak pengundian UK untuk meninggalkan blok berkenaan.

Kadar faedah AS yang dijangkakan meningkat juga akan meningkatkan risiko pengalian keluar modal.

HSBC Global Research dalam laporan mengenai ekonomi Asia menyatakan bahawa risiko pengaliran keluar modal juga menjadi semakin ketara disebabkan lebihan akaun semasa semakin menyusut berbanding jangkaaan setakat tahun ini.

Berdasarkan kekangan fiskal, bajet yang dibentangkan pada 21 Okt ini antara lain dijangkakan mengandungi langkah terhad yang sama untuk golongan berpendapatan rendah dan sederhana seperti Bajet 2016.

PERUNTUKAN PERBELANJAAN

Bagaimanapun, persekitaran ekonomi global yang masih rapuh akan memaksa kerajaan meningkatkan peruntukan bagi merangsang permintaan domestik dan perbelanjaan pengguna.

Profesor Ekonomi Fakulti Perniagaan Universiti Sunway, Dr Yeah Kim Leng berkata, kekangan fiskal akan menyaksikan keperluan untuk memberi keutamaan perbelanjaan ke atas bidang teras yang penting yang akan menjamin keselamatan sosial serta menjana pertumbuhan perniagaan dan pekerjaan.

“Dengan had ke atas perbelanjaan, terdapat keperluan untuk menangguhkan projek yang tidak memberi kesan segera ke atas ekonomi,” kata Yeah dalam temu bual dengan Bernama.

Bagi memaksimumkan kesan ke atas perbelanjaan, beliau juga mencadangkan kerajaan melaksanakan projek perkongsian awam-swasta.

Yeah menyokong pelepasan cukai atau pemotongan cukai untuk pertengahan 40 peratus isi rumah atau kumpulan M40 bagi menangani peningkatan kos sara hidup.

Peruntukan untuk perumahan, pendidikan, penjagaan kesihatan dan latihan, katanya, adalah amat penting bagi menyokong isi rumah di bawah 40 peratus atau kumpulan B40 itu.

Kategori M40 terdiri daripada mereka yang berpendapatan antara RM3,860 dan RM8,319 sebulan manakal kategori B40 yang berpendapatan dari RM3,855 dan ke bawah.

Bagaimanapun, jangkaan pertumbuhan ekonomi empat hingga 4.5 peratus tahun ini akan terus memberikan peningkatan sederhana kira-kira tiga hingga empat peratus dalam pendapatan kerajaan, kata Yeah dengan menambah, pendapatan tahun depan akan disokong oleh prospek cerah dalam ekonomi global.

Beliau melihat keperluan untuk menawarkan pelbagai insentif bagi merangsang pertumbuhan ekonomi dan mengekalkan keyakian pelabur, di samping menegaskan yang rancangan mengumpul dana melalui lelongan spektrum telekomunikasi juga akan meningkatkan tabungan negara.

FOKUS TERHADAP PKS

Sementara itu, Ketua Pegawai Operasi Perisian Senarai Gaji Dalam Talian PayrollPanda.my, Toine Vaessen berharap bajet akan datang akan memberi tumpuan kepada membantu perusahaan kecil dan sederhana (PKS), berikutan sumbangannya yang semakin meningkat bagi merangsang ekonomi.

“PKS adalah nadi ekonomi, menggunakan lebih 65 peratus daripada keseluruhan tenaga kerja di Malaysia dan menyumbang 36.3 peratus daripada keseluruhan KDNK,” kata Vaessen kepada Bernama.

Dalam satu kajian yang dijalankan PayrollPanda.my baru-baru ini mengenai keadaan ekonomi Malaysia, beliau berkata, ramai pembuat keputusan PKS merasakan ekonomi digital akan menawarkan banyak peluang untuk PKS.

Oleh itu mereka ingin melihat bajet akan datang memberi tumpuan untuk membantu PKS dengan transformasi digital ini dari segi infrastruktur, pelaburan, latihan, insentif cukai serta pelbagai inisiatif kerajaan yang lain.

Beliau berkata, walaupun ekonomi ketika ini lembap, PKS tetap positif mengenai prospek jangka panjang Malaysia.

“Ini menunjukkan pemilik PKS percaya kita sedang melalui tempoh yang sukar sebelum ekonomi kembali pulih,” katanya.

“Asas untuk ekonomi Malaysia yang kukuh, iaitu kestabilan, kepelbagaian dan ketahanan masih wujud. Pertumbuhan KDNK kini serendahempat peratus dan pembuat keputusan PKS menjangka kita akan kembali mencatat enam peratus dalam beberapa tahun akan datang,” tambahnya.

JANGKAAN BAJET

Bajet 2017 juga dijangka merancakkan lagi momentum perkembangan tahunan bagi mencapai matlamat penggal pertengahan yang ditetapkan Rancangan Malaysia Ke-11 (RMK11).

Ia juga dijangka menyasarkan kumpulan B40 dan M40 dan kerajaan dilihat akan meneruskan usaha membantu kebajikan kumpulan berkenaan menerusi pemberian Bantuan Rakyat 1 Malaysia (BR1M) serta menangani kebimbangan mengenai perumahan mampu milik.

RHB Research dalam nota penyelidikannya, menjangkakan peningkatan peruntukan BR1M akan ditambah bagi merangsang perbelanjaan pengguna.

Firma penyelidikan itu juga percaya kerajaan akan mengumumkan perbelanjaan bajet lebih tinggi bagi 2017 berbanding pada tahun lepas.

Bagi menggalakkan usaha pemilikan rumah, kerajaan berkemungkinan bertindak melonggarkan kaedah penilaian pinjaman, meningkatkan pengeluaran caruman Akaun 2 Kumpulan Wang Simpanan Pekerja (KWSP) serta memperkenalkan lebih banyak skim Perumahan Rakyat 1Malaysia.

KEBIMBANGAN RAKYAT

Antara kebimbangan disuarakan menyentuh aspek gaji lebih rendah serta pengurangan peruntukan bagi pendidikan pada tahun lepas.

Menurut Institut Penyelidikan Khazanah (KRI), gaji rendah serta pengangguran belia sememangnya membimbangkan selain peningkatan mendadak harga makanan berbanding inflasi secara menyeluruh.

Malah, berdasarkan laporan Keadaan Isi rumah II KRI membabitkan pembangunan kesejahteraan isi rumah bagi tempoh antara 2012 dan 2014, pertumbuhan pendapatan isi rumah Malaysia tidak dipacu oleh pertumbuhan gaji dan pendapatan.

Bagi tempoh 2012 hingga 2014, purata pendapatan isi rumah meningkat kepada Kadar Pertumbuhan Tahunan Terkumpul (CAGR) masing-masing sebanyak 10.8 peratus dan 12.4 peratus, namun kadar pertumbuhan nominal gaji dan pendapatan terbukti lebih perlahan pada 3.3 peratus.

Berdasarkan statistik baru-baru ini, median gaji di Malaysia pada 2015 adalah RM1,600 sebulan.

Ia turut membangkitkan aspek kewangan isi rumah yang terus berdepan tekanan dengan nisbah hutang isi rumah daripada KDNK adalah 89.1 peratus pada 2015 yang mana sebahagian besar beban hutang itu membabitkan pembiayaan bagi pembelian rumah.

Laporan KRI itu turut menunjukkan pekerjaan yang berteraskan kemahiran menawarkan gaji lebih tinggi, namun banyak syarikat Malaysia sebaliknya mengakui berdepan kesukaran mendapatkan modal insan yang memiliki kepakaran sedemikian.

BAJET MENJADI PEMACU DALAM AGENDA EKONOMI MALAYSIA

Bank Dunia telah menyatakan keperluan untuk pembaharuan struktur dalam Malaysia ekonomi terutamanya dalam modal insan, liberalisasi dan daya saing selaras dengan aspirasi negara untuk bergerak ke arah sebuah negara berpendapatan tinggi.

Oleh itu, Malaysia tidak boleh berpuas hati dengan kejayaan dan melihat kebimbangan yang dibangkitkan berikutan laporan Forum Ekonomi Dunia 2016-2017 baru-baru ini, yang menunjukkan penurunan ranking daya saing global Malaysia pada kedudukan ke-25 daripada 18 pada tahun lepas.

Masih terdapat keperluan untuk melihat bidang yang memerlukan perhatian lanjut dan penambahbaikan bagi meningkatkan keyakinan dalam kalangan pelabur termasuk kepentingan amalan tadbir urus untuk menghalang sebarang kemungkinan ketirisan dalam kewangan dan bajet kerajaan.

Dalam Bajet 2016, peruntukan berjumlah RM267.2 bilion, dengan RM215.2 bilion adalah untuk perbelanjaan mengurus, RM50 bilion untuk perbelanjaan pembangunan dan baki RM2 bilion untuk simpanan luar jangka.

Sementara itu, bajet yang ubah suai, telah menggariskan 11 langkah penyusunan semula untuk memastikan ekonomi dan kewangan kekal pada trajektori yang tepat.

Mengenai perbelanjaan pembangunan, tumpuan akan diberikan kepada projek-projek dan program dengan kesan pengganda yang tinggi, kandungan import yang rendah dan fokus terhadap kesejahteraan rakyat.

Projek-projek yang akan diberi keutamaan termasuk pembinaan rumah mampu milik, hospital, sekolah, jalan raya dan pengangkutan awam serta keselamatan manakala projek lain dalam kajian akan dijadualkan semula.

Langkah ini dijangka dapat mengurangkan komitmen tunai sehingga RM5 bilion.

RHB Research menganggarkan peruntukan sebanyak RM45 bilion dalam perbelanjaan pembangunan kasar bagi 2017, lebih rendah daripada unjuran RMK11 tetapi masih jauh lebih tinggi daripada anggaran sebanyak RM40 bilion pada 2016.

“Peningkatan dalam perbelanjaan pembangunan kasar berkemungkinan akan memberi manfaat kepada industri pembinaan secara umum dan mengurangkan kesan daripada pelaksanaan cukai barang dan perkhidmatan serta perbelanjaan modal yang lebih perlahan oleh perniagaan berikutan harga minyak yang rendah dan persekitaran ringgit lemah,” kata RHB Research.

Antara projek-projek infrastruktur yang dirancang atau sedang dilaksanakan termasuk projek keretapi laju Kuala Lumpur-Singapura (RM34.8 bilion), Aliran Transit Massa (MRT) Lembah Klang (MRT2) dan Transit Aliran Ringan 3 (LRT3) (masing-masing RM36 bilion dan RM9 bilion), landasan keretapi dari Gemas ke Johor Bharu sepanjang 197 kilometer, lebuh raya Pan Borneo di Sarawak dan rancangan pembinaan ribuan kilometer jalan baru di kawasan luar bandar.

“Bagaimanapun, sesetengah projek infrastruktur ini seperti projek MRT dan LRT, dilaksanakan melalui pembiayaan yang tidak dimasukkan dalam imbangan kira-kira,” jelas RHB Research.

Oleh itu, pada asasnya, Bajet 2017, akan berusaha untuk memenangi hati rakyat semasa keadaan yang tidak menentu berikutan faktor luaran, sebagaimana kata-kata Presiden Amerika Syarikat Abraham Lincoln, “semua manusia berhak mendapat peluang yang sama untuk meraih kekayaan “.

Bajet 2017 tentunya akan mencergaskan lagi negara dan ekonomi.

— BERNAMA

********************

The fact is that despite the economic growth steadily 4-4.5% the past seven years, the Federal Government deficit against GDP has been on the constant angle of reduction.

It simply translate that the Federal Government has been borrowing less to achieve the desired socio economic development programs sustainable to promote steady GDP growth.

This is far from Fourth Prime Minister Tun Dr. Mahathir’s suggestion of the nation is spiralling into a “failing economy”. The first half of 2016, the GDP stands at RM590 billion. The industrial production index is 125 (2010 as 100 base point). The employment index is almost 97% of workforce.

The surplus of the current account for the first half is RM6.9 billion.

When Prime Minister Najib took over the helm of the nation, within one year he introduced the Economic Transformation Plan (ETP). The Federal Government will no longer be over reliant on oil and gas as the single largest revenue contributor.

In hindsight, his fiscal strategy is very much demonstrated today.

*Updated 1800hrs

PRIME MINISTER OUTLINES A ‘COMMITMENT’ BUDGET‎
20th October 2016

Prime Minister Najib Tun Razak today outlined the major themes of the 2017 Budget that he will deliver to Malaysia’s parliament tomorrow.
Noting that some commentators have said this will be a General Election Budget, the Prime Minister instead stated:

*“This is a commitment Budget. Others may put short-term political gain first, but this government will not.* ‎

*“We commit to ensuring that the economic fundamentals of the nation remain resilient and strong – including policy on deficit targets‎, spurred economic activity, and the long-term health of the financial system.* ‎

*“We commit to being prudent and creative in optimising expenditure, to ensure delivery for the people.*‎

*“And we commit to a comprehensive, inclusive Budget that will fulfil our promises to the people.”*‎

Noting that during a year when advanced economies are expected to register growth of only 1.6 percent, Malaysia’s economy is on course to grow between 4 and 4.5 percent, the Prime Minister said: ‎

*“Despite the challenging global environment, the measures we introduced in last year’s Budget have helped ensure that the economy remains resilient and continues to grow. We have a plan, and it is working.*‎

*“We will continue to ensure economic indicators – such as inflation levels, growth rates and debt levels – remain strong and resilient, reflecting the core fundamentals of the economy.* ‎

*“Despite fiscal pressures, inflation has been kept at low levels, and the Malaysian people as a whole are better off today than they were a year ago. Indeed, we are now an upper middle income country.*‎

*“We continue to fulfil our promises to the people in a manner that is fair and inclusive. We are on the right trajectory, with the economy expected to improve still further in 2017 with growth of up to 5 percent.*‎

 ‎

*“At the same time, we recognise that there are challenges. We must put in place policies that address long-term structural changes, and will continue our efforts to improve the Bottom 40 as well as the Middle 40. Our focus is on both the people economy and the public economy. The overall happiness and welfare of the people is key objective.”*‎

 ‎

The Prime Minister said he would make further announcements on infrastructure, development, public transport and health, fiscal incentives for small and medium enterprises, and human capital and skills training. He said:‎

 ‎

*“In line with our commitment to put the people first; we intend to accelerate economic growth, empower human capital, drive education, increase connectivity, strengthen inclusive development and improve public service delivery.”*‎

In order to do so, the Prime Minister said that a major focus of the 2017 Budget will be on raising the disposable income of the rakyat; encouraging upscaling, reskilling and entrepreneurship training; mitigating the rising cost of living; providing more affordable houses, and funds for maintenance; substantial measures on education; and allocations for the provision of quality healthcare services.

The Prime Minister concluded by saying:
*“The safety and security of all Malaysians remains my biggest priority. We will intensify our efforts and allocate more resources to our fight against extremism and crime.”*‎

PRIME MINISTER’S OFFICE

MALAYSIA
*For more information:*
Please see http://www.treasury.gov.my
During the Budget speech:
Live stream on http://www.NajibRazak.comhttp://livestream.najibrazak.com/
Live stream on Najib Razak Facebook – https://www.facebook.com/najibrazak/
Live Tweets on Najib Razak Twitter (Bahasa Malaysia) – https://twitter.com/NajibRazak
Live Tweets on PMO Malaysia (English) – https://twitter.com/PMOMalaysia
After the Budget Speech 
Full text of speech immediately available (Bahasa Malaysia and English) – https://www.najibrazak.com/bm/blog/
Explanatory infographics – https://www.facebook.com/najibrazak/ or Najib Razak Email (subscribe via https://www.najibrazak.com/en/)
ENDS

Published in: on October 19, 2016 at 23:59  Comments (1)